If everyone knew they were retarded then it would be clear to all that no one should be in charge or rule over anyone else since they were a retard. This would mean that society would be forced in to a true anarcho-capitalist society since everyone would agree that there should not have a retard making the rules (that would be retarded) and since everyone is a retard there would be no one dictating restrictions on free trade.

Thus utopia would ensue.